Defaults and The Banking Code

[Jamesx81x]

Hi

 

I currently have 3 defaults on file with 3 seperate banks as a result of penalty charges. After looking at the Banking Code it clearly states,

 

 

13.6 We may give information to credit reference agencies about the personal debts you owe us if

• ·you have fallen behind with your payments;
  
• ·the amount owed is not being disputed; and
  
• ·you have not made proposals we are satisfied with for repaying your debt, following our formal demand.
  

All 3 are in dispute and have been all along so i was just wondering where this leaves me in getting the defaults removed on those grounds. I put this to Experian and they said as per usual the creditor says the information is correct and to stay on file. Would it be worth contacting the banks or who would be my next point of call?

 

Thanks

[flyingdoc]

I would contact the banking ombudsman and the OFT.

 

I would also write to the banks asking them to remove the CRA information as it contravenes their own code.

 

It might also be an idea to ask the CRA to put a note on the reference while it is on file to announce to anyone looking that these are disputed debts and should not have been registered in the first place.

[Jamesx81x]

Thanks for the reply.

 

I will try those steps and see where it gets me.

[BankFodder]

Bank routinely ignore para. 13.

 

You should complain to the FOS and to the Information Commissioner. However, if you want to make a real impression then you should bring an action for breach of Data Protection Act and breach of contract - as the banking code is incorporated in the banking contract.

We have often suggested tis but no one so far wants to have a go.

 

A judgment in your favour would be the most meaningful step foward

Edited December 9, 2008 by BankFodder

[Jamesx81x]

Would this involve court action?

 

If so how would i go about setting out the claim?

 

Thanks

[BankFodder]

Yes it would involve court action. The easiest way to go might be to assert that para. 13 of the banking code is a term and that the term has been breached. However, you will be seeking an order that the data entry is removed. Let me say that they will fight like cats to stop this. I am not aware of any court decision which has confirmed that the banking code is contractual.

 

They will want to resist because they will not want a finding that the code is part of the contract. They will also want to resist a forced data removal because they realise that this would be big news and that they would be forced to do it for thousands of others.

It could get rather exciting.

 

Because you would be asking for a court order and not a money remedy, I expectthat the cost of starting the action would be £150.

 

I rate your chances of success as extremely high but it would get very rough and would be very newsworthy.

 

We would do whatever we could to help you

[Jamesx81x]

Thank you so far the information given has been great.

 

Only thing i am a little confused on is the bit were you say you are not aware of any court decision which has confirmed that the banking code is contractual.

 

How would i argue my case that they have breached the banking code if it is not actually classed as contractual?

 

Is the code actually part of the banking contract? If so where would i find this information to be able to use it?

 

Thanks very much so far.

 

James

[Jamesx81x]

Furthermore i have just been reading through letters received from the bank in relation to my complaint.

 

A section of their letter sates: We're very upfront with our tarriff structure, and details are provided when the account is first opened, with advance notice being given to account holders in the event of any changes, in line with the Banking Code.

 

Is this not a blatant statement by them that they abide by the code?

 

Seems like they pick and choose when it applies.

[Jamesx81x]

Just wrote initial letter to Nationwide see how far i get with that first.

 

Bankfodder, anyone got any further info on above few posts i wrote?

 

Thanks

[Jamesx81x]

Hi

 

Just waiting for reply from Nationwide regarding letter i sent them.

 

Been searching round and came accross the following which sets out the frame work by which the FSA and the Banking Code Standards Board (BCSB) will co-operate and carry out their duties.

 

It is signed by both the Director of Banking for the FSA and Cheif Exec of BCSB.

 

http://www.fsa.gov.uk/pubs/mou/fsa_bcsb.pdf

 

Check out section 3.2. All subscribers to the banking code are under legal contract which both the FSA and BCSB have the power and duty to enforce.

 

How can they argue against that in court?

[BankFodder]

They oculd try to argue that their contract is with the FSA/BCSB and that only they have the power to enfoce it.

 

It doesn't matter. I expect that it will be fairly straightforward to argue that the Code is part of the contract. It doesn't matter that it hasn't been done before. There is always a first time.

I would have thought that the prospect of a formal decision about this point by a judge would persuade the bank to settle out of court.

 

What have you written to Nationwide? Please will you let us have the text here.

I can guarantee you that you will get dilatory responses from them. You shojld not tolerate this and you should move quickly from next step to next step so that they start to appreciate that you are not to be mucked around with.

Please post up the text of your letter.

[e_inspired]

have a read of this: It states that the banking code does not become part of the terms and conditions us less both parties agree that it should.

 

Banking Litigation - Google Book Search

[BankFodder]

have a read of this: It states that the banking code does not become part of the terms and conditions us less both parties agree that it should.

 

Banking Litigation - Google Book Search

This is correct to the extent that agreement of both parties is required. This is the case with most terms in any contract.

However insofar as it suggests that the incorporation of the code must be expressly incorporated, I think that this is incorrect. The code is incorporated by implication.

All banks include in their sales pitch that they are subscribers to the code. The code sets out minimum standards of behaviour for the conduct of the contract. Many of the point in the code are so reasonable that they would be required by law anyway even without the code.

It is inconceivable that any bank would openly trumpet that the code was only "a sales pitch" and was not intended to be taken seriously by potential customers or by existing customers.

 

The code is voluntary but only to the extent that each bank is free to not to subscribe to it. Having subscribed to it, then they are bound to observe its provisions.

The Banking Code is a voluntary undertaking to incorporate its terms into the account contract.

 

However, the impression given by Warne and Elliot's book is a convenient one which the banks are only too pleased to be the received wisdom.

It is also for this reason that they will be very unhappy to have a decision which confirms that the code is indeed incorporated into the contract.

[BankFodder]

Still very much like to see that letter

[Jamesx81x]

I will post the letter i sent to them very shortly and list the replies if any etc i get also.

 

[angel_1]

I will post the letter i sent to them very shortly and list the replies if any etc i get also.

 

 

 

hiya Jamesx81x

 

am subbing as thinking this is a good subject and since had my first default, and i believe the account is now terminated by them, i want to try an alternative angle and been trying to see the bigger picture as such,

 

so wish you lots of luck if you persue it, i might join you and we could then go for 2 different banks and see how things work out

 

with bankfodder and others here im sure we can persue this with confidence

 

i like being a rebel of sorts, lol but of course have to get a good plan and correct information to take it all the way, but am willing to try

 

looking forward to the next posts from all

 

 

laters angel x

[Ihatedca's]

I thought the banking code was made mandatory by the queen in her speech.

have a look at this artical:

Government makes banking code of conduct mandatory - LDPbusiness

Edited December 28, 2008 by Ihatedca's

[angel_1]

I thought the banking code was made mandatory by the queen in her speech.

have a look at this artical:

 

Government makes banking code of conduct mandatory - LDPbusiness

 

 

thanks for that Ihatedca's

 

i wonder could we actually address our complaint to the government instead of lloyds and the other banks we the public are funding>? Wonder whether a court action would entice a big publicity drive for us litigants in person? only my madness taking over, must go and take my tablet

 

but seriously can you imagine a mere bloke or woman down the road ie one of us, taking on the government instead of lloyds say, its just too mad to become true....

 

have a fun day only my crazy thinking, laters angel x

[Ihatedca's]

Peaceful protest i hope lol

I would have thought this site had picked up on the queens speech lol

[nieve]

hi, sorry to but in, but im not sure if this relates to my situation at present.

 

i had a current account with hsbc with an overdraft facility. I started a claim for unfair bank charges in April 2007. totaling 3kish.

 

i have always maintained that the account is in dispute. But on 31st oct 08 received a court claim form. I think I am defending the claim, that is if i have done it correctly. on the grounds of the unfair charges.

 

reading your posts. does it mean that under the banking code they are wrong and breaking the code in takeing me to court. I am awaiting my hearing date, and would love any information or advice you lot could give.

[e_inspired]

Out of interest I have T&C for Egg loan I took out in 2004, clause 23 states:

 

"We will comply with the provisions of the Banking Code. Copies of the Banking Code are available on request"

 

I guess this would make the banking code part of the contract?

[Ihatedca's]

Out of interest I have T&C for Egg loan I took out in 2004, clause 23 states:

 

"We will comply with the provisions of the Banking Code. Copies of the Banking Code are available on request"

 

I guess this would make the banking code part of the contract?

 

Yep it woud but as i said i think the queen made it mandatory anyway but someone would have to confirm that for me.

[Jamesx81x]

It is a legally binding contract which if broken can be pursued for damages as with any contract.

[Jamesx81x]

This is the initial letter i sent to them. Still waiting but it has been christmas so will give them an extra few days.

 

Nationwide Building Society

Member Account Servicing

1st Floor Electra House

Farnsby Street

Swindon

SN2 1SR

 

14 December 2008

 

Re: Complaint – FlexAccount ****/**********

 

Dear Nationwide

 

After recently viewing my credit report I have noticed that you have placed a default notice on the 14-09-2006.

 

On the 24-04-2006 I made the initial complaint regarding the charges incurred to my account and how I adamantly disputed the balance you claimed due to these charges.

 

The Banking Code which Nationwide subscribes to clearly states:

 

 

13.6 We may give information to credit reference agencies about the personal debts you owe us if

• ·you have fallen behind with your payments;
  
• ·the amount owed is not being disputed; and
  
• ·you have not made proposals we are satisfied with for repaying your debt, following our formal demand.
  

With this in mind you are in breach of paragraph 13.6 Section 2 by issuing the default after a dispute had been raised.

Furthermore in your ‘key commitments to you’ section regarding the code you clearly state; ‘We promise that we will act fairly and reasonably in all our dealings with you by meeting all the commitments and standards in this Code.’

 

This is clearly not the case on this occasion.

 

I request that you remove this default from all 3 Credit Reference agencies otherwise I will have no alternative to take further action which will include a full complaint to the Banking Code Standards Board who state that it makes sure that any institutions which subscribes to the code follow it. Something Nationwide clearly haven’t done In this case.

A full Complaint will also be made to the Banking Ombudsman.

 

I look forward to your response.

 

Will post the reply if and when i get one

[Jamesx81x]

Hi

 

Finally got a reply of Nationwide stating that as i di not follow up the claim after their final letter they took it as the account was no longer in dispute therefore the default was added legally.

 

Yet in July 2006 i passed the account onto a claims company who wrote direct to Nationwide and received the standard reply of until the outcome of the test case blah blah we will log yor complaint.

 

Just waiting for the company to send me copies of these letters and they also have written to Nationwide to state that thy should not be issuing defaults on a disputed account.

 

And how are they going to argue their way out of that one? Unlucky!!